2011-06-08 09:00:00 CEST
2011-06-08 09:00:05 CEST
REGULATED INFORMATION
Panostaja Oyj - Interim report (Q1 and Q3)
PANOSTAJA GROUP INTERIM REPORT 1 November 2010 - 30 April 2011
Panostaja Oyj Stock Exchange Bulletin, 8 June 2011 10:00
PANOSTAJA GROUP INTERIM REPORT 1 November 2010 - 30 April 2011
Operating profit for the second quarter was MEUR 1.7, growth 18%.
Panostaja Oyj's holding in Ecosir Group Oy dropped to below 50%.
SECOND QUARTER, FEBRUARY-APRIL 2011
-- Net sales MEUR 40.3 (MEUR 34.7), growth 16%
-- Operating profit MEUR 1.7 (MEUR 1.4), growth 18%
-- Operating profit before taxes MEUR 1.0 (MEUR 1.0)
-- Earnings per share (undiluted) 1.0 cents (-1.2 cents)
-- Cash flow from business operations MEUR -1.8 (MEUR -1.1)
-- The MEUR 5.6 growth in net sales resulted from the business acquisitions
realised during the previous financial period and from the recovery of the
engineering industry. Their impact on the net sales for the second quarter
stood at MEUR 6.3.
-- The MEUR 0.3 increase in operating profit was primarily the result of
growth in net sales. Corporate acquisitions realised during the previous
quarter, alone, affected the increase of operating profit during the second
quarter by MEUR 1.1.
-- The cash flow of the second quarter was burdened by the interest costs of
repurchased shares of subordinated loan, which amounted to MEUR -0.7
NOVEMBER 2010 - APRIL 2011
-- Net sales MEUR 78.6 (MEUR 62.9), growth 25%
-- Operating profit MEUR 2.3 (operating loss MEUR -0.3)
-- Operating profit before taxes MEUR 1.1 (MEUR -1.1)
-- Earnings per share (undiluted) 0.7 cents (-4.2 cents)
-- Equity per share EUR 0.65 (EUR 0.64)
-- Equity ratio 33.1% (32.2%)
-- Cash flow from business operations MEUR -0.2 (MEUR -0.4).
Panostaja will specify its result management procedures as regards net sales.
In 2011, the Group's net sales are estimated to grow approx. 15-20% over the
previous year. The profitability of the business areas is expected to improve
significantly resulting in a clearly positive result for the financial period.
Previous result management procedure: In conjunction with the financial
statement bulletin 16 December 2010 and the interim report bulletin 9 March
2011, the company estimated that the net sales for the period will surpass the
level of the previous financial period. The profitability of the business areas
is expected to improve significantly resulting in a clearly positive result for
the financial period.
Key figures 02/11-04/11 02/10-04/10 11/10-04/11 11/09-04/10
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Net sales, 40.3 34.7 78.6 62.9
MEUR
Operating 1.7 1.4 2.3 -0.3
profit, MEUR
Profit before 1.0 1.0 1.1 -1.1
taxes, MEUR
Earnings per 1.0 -1.2 0.7 -4.2
share
(undiluted),
cents
Equity per 0.65 0.64
share, EUR
Financial 30 April 2011 30 April 2010 31 October 2010
position and
cash flow:
------------------------------------------------------------
Net 48.7 49.7 51.8
liabilities,
MEUR
Gearing, % 102.0 115.8 123.1
Equity ratio, 33.1 32.2 31.9
%
Cash flow from business -0.2 -0.4 1.3
operations, MEUR
In the financial statement, the profit from sold business and the profit from
continuous business operations have been separated in accordance with the IFRS
standard. Unless otherwise specified, the figures listed in this interim report
for the 2011 financial period and the reference year 2010 concern the Group's
continuous operations. Therefore, they do not include the Environmental
Technology sector, which was sold in April.
MARKET SITUATION
On the whole, Panostaja Group's business operations continued their positive
trend through the second quarter, even though there was considerable variation
in the development of different segments. Towards the end of the financial
year, the Group's management will focus on improving the profitability of the
few weak segments. The general economic situation would seem to support
continued positive development through the rest of the financial period, and
even though the corporate acquisition markets have shown signs of
reinvigoration, the situation remains fairly stagnant within Panostaja's target
group.
FINANCIAL DEVELOPMENT
PANOSTAJA GROUP
FEBRUARY-APRIL 2011
Panostaja Group's net sales were MEUR 40.3 (MEUR 34.7) at the end of the
quarter. The growth in net sales was partially caused by the reinvigoration of
the engineering industry markets, but it was particularly due to the corporate
acquisitions implemented during the previous financial year. Their impact on
the net sales totalled MEUR 6.3. Net sales increased especially in the Digital
Printing Services, Takoma, and Heat Treatment segments.
Of the Group's twelve segments engaged in business, eight exceeded the net
sales and operating profit for the previous year. Four fell short of the prior
levels. Net sales increased in the following segments: Safety, Digital Printing
Services, Takoma, Spare Parts for Motor Vehicles, Heat Treatment, Carpentry
Industry, as well as Supports and Fasteners. Net sales declined in the
following segments: HEPAC Wholesale, Value-added Logistics, Fittings, and
Technochemical. Ecosir Group Oy separated from the Group during the second
quarter.
In the second quarter, the Group's operating profit was MEUR 1.7 (MEUR 1.4
operating profit) and profit before taxes was MEUR 1.0 (MEUR 1.0). The
operating profit margin was 4.2% (4.0%). The MEUR 0.3 increase in operating
profit was primarily the result of growth in net sales. Corporate acquisitions
realised during the previous quarter, alone, affected the increase in operating
profit during the second quarter by MEUR 1.1.
The net sales for the first quarter were 38.3 MEUR, and the operating profit
stood at MEUR 0.6.
NOVEMBER 2010 - APRIL 2011
Panostaja Group net sales were MEUR 78.6 (MEUR 62.9) at the end of the second
quarter. Corporate acquisitions realised during the previous quarter affected
the MEUR 15.7 increase in operating profit by MEUR 12.3.
Of the Group's twelve segments engaged in business, ten exceeded the cumulative
net sales for the previous year. Two fell short of the prior levels.
Correspondingly, eight segments showed an increase and four a decrease in
operating profit from the previous year.
The operating profit was MEUR 2.3 (MEUR -0.3). The MEUR 2.6 increase in
operating profit was primarily the result of growth in net sales. The effect of
the implemented corporate acquisitions on the growth in operating profit was
MEUR 1.4. Operating profit improved particularly in the following segments:
Safety, Heat Treatment, Spare Parts for Motor Vehicles, Value-added Logistics,
and Carpentry Industry.
The loss on discontinued business operations was MEUR -0.4. For the reference
year, the net sales on discontinued operations stood at MEUR 1.4, while the
operating loss was MEUR -2.3 euros, and the loss for the financial period
totalled MEUR -2.0. The Group's financial statement does not include a figure
indicating the profit/loss from discontinued operations for the reference year
2010. Instead, the loss (MEUR -2.0) is separately listed in the Group's
financial statement on row Earnings from discontinued operations. The loss from
discontinued operations for the second quarter of 2010 was MEUR -1.3.
Before separating the discontinued operations from continued operations in the
financial statement, the Group's net sales in 2010, for the six-month period,
was MEUR 64.3, while the operating loss stood at MEUR -2.6, and the operating
profit before taxes was MEUR -3.5.
The net financing costs of the Group for the six-month period were
approximately MEUR -1.3 (MEUR -1.0). The financial position and liquidity of
Panostaja Group remained good. In the period under review, the financial
expenses were burdened by the interest costs of repurchased shares of
subordinated loan, which amounted to MEUR -0.7.
Personnel
30 April 2011 30 April 2010 31 October 2010
--------------------------------------------------------------------------------
Average number of employees 1,006 880 967
Employees at the end of the 1,034 1,011 970
period
--------------------------------------------------------------------------------
Employees in each segment at the end of 30 April 30 April 31 April
the period 2011 2010 2010
--------------------------------------------------------------------------------
Safety 168 151 151
Digital Printing Services 309 206 256
HEPAC Wholesale 37 37 37
Takoma 171 180 168
Value-added Logistics 131 167 123
Fittings 31 32 32
Spare Parts for Motor Vehicles 32 30 31
Heat Treatment 61 64 64
Carpentry Industry 32 35 35
Supports 15 16 16
Fasteners 25 24 24
Technochemical 12 20 14
Environmental Technology 39 9
Other 10 10 10
--------------------------------------------------------------------------------
Group in total 1,034 1,011 970
--------------------------------------------------------------------------------
GROUP STRUCTURE CHANGES
In December 2010, Panostaja Oyj's subsidiary Digiprint Finland Oy purchased the
entire share capital of Suomen Graafiset Palvelut Oy Ltd, which offers print
products and services. The net sales of Suomen Graafiset Palvelut Oy Ltd during
the financial year ending in April 2010 totalled MEUR 3.2, and the company
employed 30 people. The company's domicile is Kuopio and it has an office in
Helsinki.
At the end of April, the acting management and other shareholders of Ecosir
Group Oy purchased EcoSir Group shares held by the Panostaja Oyj to an extent
that reduced Panostaja Oyj's sharehold in the company to 49%, whereby Ecosir
Group Oy is no longer a subsidiary of Panostaja Oyj. In conjunction with the
transaction, Panostaja Oyj made an investment of approx. MEUR 2.5 in Ecosir
Group Oy's invested unrestricted equity fund. The investment was carried out by
converting MEUR 2.4 of Panostaja Oyj's receivables and partially by means of a
new investment. The arrangement did not significantly affect Panostaja Group's
profit/loss. After the transaction, Panostaja Oyj's receivables from Ecosir
Group total MEUR 2.2. The terms of the receivables match those of subordinated
loans. In the future, Panostaja Oyj will report Ecosir Group Oy as an
associated company. After the transaction, the purchase cost of associated
company shares in Panostaja Oyj's balance sheet is at MEUR 0.2.
At the end of March, Jouni Arolainen (age 43) was invited to serve as Vindea
Oy's managing director. Before the new assignment, Arolainen worked as the
deputy managing director of Vindea Oy. The previous managing director, Risto
Rousku, will take a new position outside the Group.
SEGMENT INSPECTION
The business operations of Panostaja Group are reported in thirteen segments:
Safety, Digital Printing Services, HEPAC Wholesale, Takoma, Value-added
Logistics, Fittings, Spare Parts for Motor Vehicles, Heat Treatment, Carpentry
Industry, Supports, Fasteners, Technochemical and Others (parent company).
NOVEMBER-APRIL
Net sales in the Safety segment increased from MEUR 10.3 to MEUR 11.8, while
operating profit increased by MEUR 1.0 resulting in a six-month total of MEUR
0.6 (MEUR -0.4). Both net sales and operating profit development were
positively affected by revitalised customer demand and the stabilisation of
post-merger business operations. A corporate acquisition took place in the
segment during the period under review: the Group purchased the business
operations of Lukkohuolto Lempiäinen from Lahti.
Net sales in the Digital Printing Services segment grew by MEUR 5.7 from MEUR
9.4 to MEUR 15.2, while the operating profit rose from MEUR 1.5 to MEUR 1.7.
Growth was affected by the positive development of operative functions. The
Digital Printing Services segment expanded during the previous financial period
with the corporate acquisition of Domus Print Oy as well as that of Suomen
Graafiset Palvelut Oy, which was acquired on 16 December 2010. These
acquisitions exerted a positive impact on the segment's net sales.
Net sales of the HEPAC Wholesale segment increased from MEUR 9.1 to MEUR 9.2,
with operating profit remaining on the level of the previous year at MEUR 0.1.
Renovation construction is expected to continue its pattern of growth, even
though it has been necessary to postpone the commencement of new construction
projects due to difficult weather conditions. New construction has continued at
a low level through the six-month period.
Net sales in the Takoma segment increased from MEUR 7.4 to MEUR 13.8. Operating
loss decreased from MEUR -0.7 to MEUR -0.3. The growth in net sales was nearly
entirely caused by Takoma Gears Oy, which was acquired during the previous
financial period. The positive outlook of customers in the technology industry
positively affected the improved result of the six-month period. The shipping
and offshore industry is reviving, but the declined availability of resources
and the elevated price level have slowed down the development of operative
activities.
In the Value-added Logistics segment, net sales remained level with the
previous year at MEUR 7.5. However, at the same time, operating loss decreased
from MEUR -0.6 to MEUR -0.1. The volume of customers operating in the
technology industry has clearly increased. The competitive environment of the
segment has nevertheless remained challenging.
Net sales in the Fittings segment declined from MEUR 6.0 to MEUR 5.7. Operating
profit dropped from MEUR 0.4 to MEUR 0.3. During the first two quarters,
customers' demand in construction and furniture fittings has been less active,
but the demand is expected to increase during the second half of the year as
construction picks up.
Net sales in the Spare Parts for Motor Vehicles segment grew from MEUR 3.9 to
MEUR 4.4 and operating profit increased from MEUR 0.2 to MEUR 0.4. The demand
for original spare parts has remained good. The expansion of the electronic
ordering system has facilitated the ordering process, increased the efficiency
of the operations and accelerated the sale of spare parts.
Net sales in the Heat Treatment segment grew by MEUR 1.3, while operating
profit increased by MEUR 0.8. Net sales rose from MEUR 2.9 to MEUR 4.2, and
operating profit increased from MEUR 0.1 to MEUR 0.9. The demand for heat
treatment services and investments in new equipment stock have shown clear
recovery. In addition, repair investments in the technology industry have
provided impetus for growth in this segment.
Net sales in the Carpentry Industry segment grew from MEUR 2.7 to MEUR 3.1
while operating loss increased from MEUR 0.3 to MEUR 0.6. Improvement in net
sales and profitability were given impetus by increased customer demand. The
development was further aided by the successful product launches and raising of
market share.
In the Supports segment, net sales were MEUR 1.7 (MEUR 1.6). Operating profit
remained at MEUR 0.0. The Supports segment, too, has suffered from poor weather
conditions during the period and from the resulting delays on the initiation of
new construction projects.
Net sales in the Fasteners segment grew from MEUR 1.3 to MEUR 1.5, while
operating loss improved from MEUR -0.2 to MEUR 0.0. Customer demand in the
segment has remained low, but the segment has nonetheless increased its net
sales and operating profit.
Net sales in the Technochemical segment declined from MEUR 1.1 to MEUR 0.8.
Operating loss grew from MEUR 0.0 to MEUR -0.2. With respect to demand for
technochemical products, the economic trend is turning at a slower than
expected rate, but the markets are showing signs of recovery.
There were no significant changes in the net sales of the Others segment.
Ecosir Group Oy separated from the Group in April. In the future, the parent
company will report Ecosir Group Oy as an associated company. The value of the
associated company's shares in the parent company's balance total approx. MEUR
0.2.
INVESTMENTS AND FINANCING
The Group's gross investments for the review period amounted to MEUR 5.9 (MEUR
7.2). The Group's largest single investments were the acquisition of Suomen
Graafiset Palvelut Oy Ltd and purchasing Takoma's new production facilities in
Akaa. The goodwill of the Group has declined as a result of the acquisition of
Suomen Graafiset Palvelut Oy Ltd, the adjustment in the sale price of Bewator
Oy, and the sale of Ecosir Group Oy.
The assets of the Group were MEUR 16.0 (MEUR 13.3). The Group's equity ratio
was 33.1% (32.2%) and net debts with interest totalled MEUR 48.7 (MEUR 49.7).
During the review period, the Group reorganised its financing loans in several
segments. The value of the reorganised loans amounts to approx. MEUR 13.
The Group's liquidity was good despite the negative cash flow (MEUR -0.2) and
investments made. The cash flow from business operations for the second quarter
was MEUR -1.8 (MEUR -1.1). Panostaja Oyj repurchased shares of the 2006
convertible subordinated loan at a value of MEUR 11.6. The cash flow of the
second quarter was burdened by the interest costs of the repurchased loan
shares, which amounted to MEUR -0.7.
The Board of Directors approved new 2011 convertible subordinated loan issues
totalling MEUR 15. The convertible subordinated loan is divided into equity and
liabilities. The equity component is calculated by determining the difference
between the monetary amount obtained through the loan issue and the current
value of the loan. The equity component of the 2011 convertible subordinated
loan, EUR 598,000, has been entered in the invested unrestricted equity fund.
At the end of the review period, Panostaja Oyj's convertible subordinated loan
amounted to MEUR 20.6 of the net liabilities (MEUR 17.2 at the beginning of the
period).
The return on equity was 4.3% (-10.9%). The return on investment was 4.2%
(-4.5%).
Financial position:
MEUR 30 Apr. 2011 30 Apr. 2010 31 Oct. 2010
--------------------------------------------------------------------------------
Interest-bearing liabilities 69.0 63.6 63.9
Interest-bearing receivables 0.2 0.6 0.8
Cash and cash equivalents 20.1 13.3 11.3
Net interest-bearing liabilities 48.7 49.7 51.8
Equity (belonging to parent company 47.8 42.9 42.1
shareholders as well as minority
shareholders)
--------------------------------------------------------------------------------
Gearing, % 102.0 115.8 123.1
Equity ratio, % 33.1 32.2 31.9
Return on equity, % 4.3 -10.9 -6.9
Return on investment, % 4.2 -4.5 -1.1
--------------------------------------------------------------------------------
The Annual General Meeting (27 Jan. 2011) approved the dividend distribution
proposed by the Board. The dividend paid was EUR 0.05 per share. The record
date for dividend distribution was 1 February 2011 with payment from 8 February
2011. The dividend paid to the parent company's shareholders totalled MEUR 2.6.
SHARE PRICE DEVELOPMENT AND SHARE OWNERSHIP
Panostaja Oyj's share price fluctuated between EUR 1.21 and EUR 1.51 during the
six-month period under review. The exchange of shares totalled 2,732,058
individual shares, which represents 5.6% of share capital. The April share
closing rate was EUR 1.22. The market value of the company's share capital at
the end of April was MEUR 63.1 and the company had 3,922 shareholders (4,124).
Development of share 4-6/2011 4-6/2010 1-6/2011 1-6/2010
exchange
--------------------------------------------------------------------------------
Exchanged shares, 1,000 pcs 720 1,401 2,732 3,660
% of share capital 1.5 3.0 5.6 7.9
--------------------------------------------------------------------------------
Share 30 Apr. 2011 30 Apr. 2010 31 Oct. 2010
--------------------------------------------------------------------------------
Shares in total, 1,000 pcs 51,733 47,403 47,403
Own shares, 1,000 pcs 622 1,277 1,262
Closing rate 1.22 1.49 1.46
Market value, MEUR 63.1 70.6 69.2
Shareholders 3,922 4,124 4,050
--------------------------------------------------------------------------------
The Board decided on 16 December 2010 on a new long-term incentive and
commitment plan for members of the Management Team. During the review period,
Panostaja sold 623,561 of its own individual shares to the members of the
Management Team, and the latter acquired a total of 950,000 personal or
controlling Panostaja shares specified as the maximum quantity in the company's
ownership system.
The Management's share ownership within the incentive and commitment-building
system is distributed as follows:
Pravia Oy (Juha Sarsama) 350,000 shares
Artaksan Oy (Simo Mustila) 200,000 shares
Heikki Nuutila 200,000 shares
Comito Oy (Tapio Tommila) 200,000 shares
Total 950,000
shares
The members of the Management Team have partly financed their investments
themselves and partly through company loans, and they carry genuine corporate
risk with respect to the investment they have made in the system. In order to
enable the procurement of the shares and as part of the system, Panostaja's
Board decided to grant a loan with interest in the amount of EUR 1,250,000
maximum to the Management Team members or to the companies in which they have a
controlling interest. The Management raised an interest-bearing loan to the
total amount of EUR 1,207,127.84 to finance the acquisition.
During the period 2011-2015, members of the Management Team participating in
the system may be granted a maximum of 237,500 Panostaja shares as a bonus on
the basis of the achievement of set targets. Possible bonus may also be paid in
cash to cover taxes and tax-like payments arising from the bonus. Members of
the Management Team are obliged not to sell shares received as a bonus for a
period of 27 months after having received them.
During the review period, Panostaja Oyj received four notifications pursuant to
Chapter 2, Section 9 of the Securities Markets Act concerning changes to
ownership in a company.
On 16 December 2010, Panostaja Oyj announced the buy-back of the 2006
convertible subordinated loan and the issue of a new 2011 convertible
subordinated loan. On 16 December 2010, Panostaja Oyj received a notice from
Etera Mutual Pension Insurance Company, since Etera's possible future holding
in Panostaja Oyj shall be, in total, 3,318,182 shares and votes when Etera uses
the rights of exchange respective to Panostaja's 2011 convertible subordinated
loan in full. This holding falls below 10% of Panostaja Oyj's share capital and
number of votes. The holding corresponded to 6.74% of Panostaja Oyj's
post-exchange number of shares and votes by the date of the announcement,
taking into account the shares issued.
Furthermore, on 21 December 2010, Panostaja Oyj received a notice from Etera
Mutual Pension Insurance Company, since Etera's possible future holding in
Panostaja Oyj shall be, in total, 6,077,182 shares and votes if Etera uses the
rights of exchange respective to Panostaja's 2011 convertible subordinated loan
in full. This holding exceeds 10% of Panostaja Oyj's share capital and number
of votes. The shareholding is equivalent to 11.42% of the number of Panostaja
Oyj's post-exchange shares and votes, taking into consideration the shares
issued by the date of the bulletin.
As a result of the options issue, on 23 December 2010, the company received
Mauno Koskenkorva's notice of change of holdings. Mauno Koskenkorva's allotment
of Panostaja Oyj's combined number of shares and votes fell under 5%. Mauno
Koskenkorva's allotment totalled 2,375,173 shares. The holding corresponded to
4.98% of Panostaja Oyj's post-exchange number of shares and votes by the date
of the announcement, taking into account the shares issued.
As a result of the issue of shares, the company received Maija Koskenkorva's
notice on 11 January 2011. Maija Koskenkorva's allotment of Panostaja Oyj's
combined number of shares and votes fell under 10%. Maija Koskenkorva's
allotment was 5,071,742 shares, which represents 9.80% of Panostaja Oyj's share
capital and number of votes.
ADMINISTRATION AND GENERAL MEETING
Panostaja Oyj's Annual General Meeting was held on 27 January 2011 in Tampere.
Jukka Ala-Mello, Satu Eskelinen, Hannu Martikainen and Hannu Tarkkonen were
again selected to Panostaja Oyj's Board of Directors. Mikko Koskenkorva and
Eero Eriksson were selected to the Board as new members. Jukka Ala-Mello was
selected as Chairperson immediately after the General Meeting, in the Board's
organisational meeting. A Vice Chairperson was not chosen. Authorised Public
Accountant Eero Suomela and authorised body of public accountants
PricewaterhouseCoopers Oy were selected as general chartered accountants, with
Authorised Public Accountant Janne Rajalahti as the responsible public
accountant.
The General Meeting approved the closing of the 1 Nov. 2009 - 31 Oct. 2010
accounts as well as the proposal of the Board to transfer the profit of the
financial period to the profit funds and that dividends would be distributed at
a rate of EUR 0.05 per share. The record date for dividend distribution was 1
February 2011 with payment from 8 February 2011. In addition, the Annual
Meeting authorised the Board of Directors to decide on possible allocation of
assets to shareholders in accordance with its discretion on the strength of the
company's financial status, either as dividends from profit funds or as
allocation of assets from the invested unrestricted equity fund. On the basis
of this authorisation, the maximum allocation of assets performed totals no
more than MEUR 4 (EUR 4,000,000). This authorisation includes the right of the
Board to decide on all other terms connected with the aforementioned allocation
of assets, and will remain valid until the next Annual General Meeting.
In addition, the General Meeting granted exemption from liability to the
members of the Board and to the Managing Director. It was decided at the Annual
Meeting that the Chairperson of the Board would be paid EUR 40,000 as
compensation for the term that begins at the end of the Meeting and ends at the
end of the 2012 Annual General Meeting, and that the other members of the Board
would obtain compensation for the year totalling EUR 20,000. It was further
resolved at the General Meeting that approx. 40% of the compensation remitted
to the members of the Board would be paid on the basis of the share issue
authorisation given to the Board, by issuing company shares to each Board
member if the Board member does not own more than one per cent of all the
company's shares on the date of the General Meeting. If the share of ownership
of a Board member on the date of the General Meeting is over one per cent of
all company shares, the compensation will be paid in full in monetary form.
Moreover, the Annual Meeting approved the proposal of the Board to revise
Section 8 of the company's Articles of Association as follows:
“Section 8 - Invitation to the Annual General Meeting and participation therein
The invitation to the Annual General Meeting must be published on the Company's
website at the earliest two (2) months and no later than three (3) weeks prior
to the Meeting, as well as at least nine days before the record date of the
General Meeting. The Board of Directors may also, in accordance with its
discretion, announce the General Meeting in one or more newspapers.
In order to be able to participate in the General Meeting, the shareholder must
register with the company no later than the day stated in the invitation to the
meeting, which may be no earlier than ten (10) days prior to the General
Meeting.”
In addition, the Annual General Meeting resolved to cancel the authorisation
concerning the acquisition of personal shares given at the General Meeting of
27 January 2010, and authorised the Board of Directors to decide on its own
acquisition of shares so that personal shares are acquired in one or several
instalments and personal shares may be acquired, on the basis of authorisation,
to the maximum total of 4,700,000. Personal shares may be obtained on the basis
of authorisation only with unrestricted equity.
Personal shares can be acquired other than in accordance with the proportion of
ownership of the shareholders in public trade arranged by NASDAQ OMX Helsinki
Oy, at the prevailing market price at the time. In acquiring shares, the rules
of NASDAQ OMX Helsinki Oy and Euroclear Finland Oy are observed.
The authorisation shall be in effect for 18 months from issue.
The Board of Directors has not used the authorisation granted by the Annual
Meeting to acquire its own shares during the review period.
The General Meeting also resolved to authorise the Board of Directors to decide
on share distribution as well as rights of option and the issue of other
special rights providing entitlement to shares. The total number of shares
issued on the basis of authorisation can be no more than 30,000,000. The
provision of share issues and rights of option as well as that of other rights
entitling to shares may occur on an exceptional basis to shareholders' right to
subscribe for new shares (directed issue).
The authorization issued at the General Meeting on 18 December 2007 to decide
on share issues and the provision of special rights with respect to share
entitlement is, by similar authorisation, cancelled. The authorisation shall be
valid until 27 January 2016.
SHARE CAPITAL AND OWN SHARES
At the close of the period under review, Panostaja Oyj's share capital was EUR
5,568,681.60. The total number of shares is 51,733,110.
The total number of shares held by the company at the end of the review period
was 622,793 individual shares (at beginning of review period: 1,262,504).
Personal shares corresponded to 1.2% of the share quantity and number of votes
at the end of the entire review period.
In accordance with the decisions of the General Meeting on 27 January 2010 and
the Board, Panostaja Oyj relinquished a total of 6,777 individual shares as
meeting compensation to the members of the Board on 17 December 2010, and, as
per the decisions of the General Meeting on 27 January 2011 and the Board on 10
March 2011, a total of 9,373 shares.
In total, 330,000 share subscriptions were approved by the Board on 15 December
2010. These are based on the rights to option given to the company management
in 2006. The share subscriptions were made with the A-options of the options
programme for the year 2006. The new shares have been entered into the Trade
Register (23 December 2010). The subscription price of the shares was entered
in accordance with the option terms as EUR 0.12 into the share capital, and the
remaining part into the fund for unrestricted invested equity.
On 16 December 2010, the Board of Directors decided on the basis of the
authorisation given at the Annual General Meeting on 18 December 2007, on an
issue of shares in which the company offered, in a manner exceptional to the
shareholders' right to subscription, a maximum of 4,000,000 new company shares
for registration by domestic institutional investors. The Board approved on 21
December 2010 the subscriptions made during the issue of shares. The issue of
shares-based subscription price was EUR 1.45 per share, so that the overall
yields of the share issue prior to sales commission as well as costs totalled
EUR 5,800,000. The new shares were entered in the Trade Register on 11 January
2011.
As a result of the subscriptions rendered with the issue of shares and
A-options of the 2006 option programme, the total number of company shares rose
to 51,733,110 shares.
SUBORDINATED LOANS
Panostaja Oyj repurchased shares of the 2006 convertible subordinated loan at a
value of EUR 12,288,658 (including interest). The transaction took place on 7
February 2011. The loan shares were bought back at a rate of 100%, with
interest up to the date of the transaction. The amount repurchased by the
company corresponds to 54.5% of the original total value of the convertible
subordinated loan maturing in 2012.
The transaction is connected to the capital arrangement announced on 16
December 2010, with regard to which the company has previously carried out a
share issue of 4,000,000 shares and the issue of a new convertible subordinated
loan valued at MEUR 15. The transaction was completed to improve the maturity
schedule of the company's non-current liabilities. The loan shares were
nullified on 28 February 2011.
After this, an amount of EUR 5,631,250 of the 2006 convertible subordinated
loan remains (EUR 17,212,500 at the beginning of the financial period). Each
EUR 106,250 share of the 2006 convertible subordinated loan entitles the holder
to exchange the share for 62,500 company shares.
The Board utilised the authorisation it received in the General Meeting on 18
December 2007 to take out a subordinated loan from domestic institutional
investors. The Board approved a total of EUR 15,000,000 subscriptions for the
2011 convertible subordinated loan, and the 2011 loan was subscribed for in
full. The interest rate for the loan is 6.5%, and the loan period is 7 February
2011-1 April 2016. The original share exchange rate is EUR 2.20, and the loan
shares can be exchanged for no more than 6,818,181 company shares. The share
exchange rate will be entered into the company's invested unrestricted equity
fund.
Trade on the 300 loan shares of the convertible subordinated loan began on the
Nasdaq OMX Helsinki stock exchange on 23 February 2011. The Financial
Supervisory Authority approved the proposal for the public trade of the
convertible subordinated loan shares on 18 February 2011.
At the end of the review period, the total sum of Panostaja Oyj's subordinated
loans stood at EUR 20,631,250.
NEAR-FUTURE RISKS AND FACTORS OF UNCERTAINTY
The most significant risks of the Panostaja Group have been described in the
financial statement. The risks the Group faces in the near future are mainly
tied to the uncertainty resulting from the global economic situation as well as
its possible impact on achieving the goals set for the various segments. The
instability of the economic situation may lead to a recurrent decline in
customer demand as well as the postponement of major investments, particularly
in segments serving the technology sector, which may result in a need for
consolidated goodwill write-downs. In the current financial period, credit loss
risks represent a factor of uncertainty in some of the segments.
EVENTS AFTER THE REVIEW PERIOD
Takoma Oyj's subsidiary Takoma System Oy purchased the business operations of
TL-Tuotanto Oy, a Keminmaa-based company specialising in hydraulics and
automation systems, for a price of approx. MEUR 0.8. TL-Tuotanto's has
typically supplied hydraulics systems for the process industry, power plants
and harbour ramps. The net sales of TL-Tuotanto Oy during the financial year
ending in December 2010 totalled MEUR 3.4, and the company employed 25 people.
The corporate acquisition is not expected to have a significant impact on
Takoma's net sales for the remainder of the financial year 2011. However, the
acquisition is estimated to have a negative effect on Takoma's operating profit
for the period. In the long run, the purchase will provide Takoma with
significant growth potential as an integrator of hydraulics systems for various
fields of industry.
PROSPECTS FOR THE REMAINDER OF THE FINANCIAL PERIOD
The Panostaja group will continue to focus on its business idea following its
fundamental business strategy and on the development of existing business
segments. In the coming years, the retirement of the ‘baby boom' generation,
ever worsening changes in the business environment and globalisation will bring
to the market a large number of companies that can be acquired. Active
development of shareholder value and financial opportunities create a solid
foundation for significant operational expansion. The increasing range of SMEs
operating in traditional fields enables both expansion into new business areas
and growth in existing ones.
Economic trend expectations in the fields of existing business areas are
strongly tied to the prospects of customer enterprises. Although the trend
expectations have generally moved in a positive direction, a move toward
permanent economic growth is still uncertain, particularly due to the credit
crisis in the euro area and internal conflicts within the Arab countries. In
the various business areas of Panostaja Group, the prospects still vary from
cautiously positive to positive. Even if the economic trends have already taken
a permanent turn for the better, the market also offers sufficient
opportunities for corporate acquisitions. Indeed, the objective of Panostaja's
growth strategy is to achieve growth through controlled corporate acquisitions.
A more permanent turn in economic trends would also enable the divestment of
some business areas.
Panostaja will specify its result management procedures as regards net sales.
In 2011, the Group's net sales are expected to grow approx. 15-20% over the
previous year. The profitability of the business areas is estimated to improve
significantly resulting in a clearly positive result for the financial period.
Previous result management procedure: In conjunction with the financial
statement bulletin 16 December 2010 and the interim report bulletin 9 March
2011, the company estimated that the net sales for the period will surpass the
level of the previous financial period. The result prospects for the entire
year remain the same. The profitability of the business areas is estimated to
improve significantly resulting in a clearly positive result for the financial
period.
Panostaja Oyj
Board of Directors
For further information, contact Juha Sarsama, Managing Director: tel. +358
(0)40 774 2099.
Panostaja Oyj
Juha Sarsama
Managing Director
All forecasts and assessments presented in this financial statement bulletin
are based on the current outlook of the Group and the Management of the various
business areas with regard to the state of the economy and its development, and
the results attained may even be substantially different. This interim report
has been prepared in accordance with the IAS 34 regulations.
In the financial statement, the profit from sold business and the profit from
continuous business operations have been separated in accordance with the IFRS
standard. Unless otherwise specified, the figures listed in this interim report
for the 2011 financial period and the reference year 2010 concern the Group's
continuous operations. Therefore, they do not include the Environmental
Technology sector, which was sold in April.
The information in the interim report has not been audited.
FINANCIAL INFORMATION
INCOME STATEMENT 02/11 02/10 11/10 11/09
-04/11 -04/10 -04/11 -04/10 2010
(EUR 1,000)
Net sales 40,344 34,675 78,611 62,863 137,939
Other operating income 167 236 400 284 1,900
Costs in total 37,344 32,512 73,937 61,557 132,337
Depreciations, amortisations and 1,476 963 2,769 1,872 4,575
impairment
Operating profit/loss 1,691 1,436 2,305 -282 2,927
Financial yields and costs -759 -565 -1,337 -1,000 -2,373
Share of associated company profits 104 182 164 182 224
Profit before taxes 1,036 1,053 1,132 -1,100 778
Taxes on income 237 -157 243 508 362
Profit/loss from continuing operations 1,273 896 1,375 -592 1,141
Loss from discontinued operations -279 -1,347 -401 -1,972 -4,346
Profit/loss for the financial period 994 -451 974 -2,564 -3,205
Attributable to
Equity holders of the parent company 477 -552 329 -1,939 -2,775
Minority 517 101 645 -625 -430
Earnings/share from continuing
operations
EUR, undiluted 0.015 0.017 0.015 0.001 0.034
Earnings/share from continuing
operations
EUR, diluted 0.013 0.014 0.015 0.001 0.028
Earnings/share from discontinued
operations
EUR, undiluted -0.005 -0.029 -0.008 -0.043 -0.094
Earnings/share from discontinued
operations EUR, diluted -0.005 -0.029 -0.008 -0.043 -0.077
Earnings/share from continuing and
discontinued
operations EUR, undiluted 0.010 -0.012 0.007 -0.042 -0.060
Earnings/share on continuing and
discontinued
operations EUR, undiluted 0.008 -0.012 0.007 -0.042 -0.060
INCOME STATEMENT
Extensive statement items 994 -451 974 -2,564 -3,205
Translation differences 3 43 13 75 80
Extensive result for the period 991 -408 961 -2 489 -3 125
Attributable to
Equity holders of the parent company 474 -509 316 -1,864 -2,695
Minority 517 101 645 -625 -430
BALANCE SHEET 04/2011 04/2010 10/2010
(EUR 1,000)
ASSETS
Non-current assets
Goodwill 36,561 39,250 39,256
Other intangible goods 5,138 5,218 5,641
Property, plant and equipment 21,193 16,653 16,406
Interests in associates 2,700 3,017 2,387
Other non-current assets 11,857 7,937 8,268
Non-current assets total 77,449 72,075 71,958
Current assets
Inventories 25,839 25,000 24,049
Trade and other receivables without interest 24,968 23,783 24,984
Short-term investments 0 828 833
Cash and cash equivalents 16,017 12,489 10,438
Non-current assets total 66,824 62,100 60,304
Assets in total 144,273 134,175 132,262
EQUITY AND LIABILITIES
Equity attributable to parent company shareholders
Share capital 5,569 5,529 5,529
Share premium reserve 4,646 4,646 4,646
Translation difference -44 -47 -56
Invested unrestricted equity fund 18,998 11,979 11,574
Retained earnings 4,295 7,319 6,497
Total 33,464 29,426 28,190
Minority interest 14,296 13,517 13,922
Equity total 47,760 43,943 42,112
Liabilities
Deferred tax liabilities 1,821 1,709 1,693
Convertible subordinated loan 19,800 16,927 16,999
Non-current liabilities 42,901 40,512 32,573
Current liabilities 31,991 32,084 38,885
Liabilities total 96,513 91,232 90,150
Equity and liabilities in total 144 273 134 175 132 262
CASH FLOW STATEMENT 04/2011 04/2010 10/2010
Net cash flow from (used in) operations -179 -401 1 264
Net cash flow from (used in) investments -5,908 -6,565 -14,333
Loans drawn 22,102 10,212 11,150
Loans repaid -15,450 -12,392 -9,298
Share issue 6,053 0 0
Disposal of own shares 918 18 38
Paid dividends -2,812 -5,878 -5,868
Net cash flow from (used in) financing 10,811 -8,040 -3,978
Change in cash flows 4,724 -15,006 -17,047
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(EUR 1,000) Share Share Invested Transla Profit Minori Total
capit premiu unrestrict tion funds ty
al m ed equity differ inter
reserv fund ences est
e
Equity 5,529 4,646 11,876 -123 14,792 14,560 51,280
1 Nov. 2009
Cost of 17
share-based
payments
Profit for the -1,939 -625 -2,564
period
Recorded total 17 -1,939 -625 -2,547
profit and costs
during the
financial period
Dividends paid -5,534 -367 -5,901
Disposal of own 18 18
shares
Translation 76 76
differences
Changes in -51 -51
minority
interest
Other changes 68 68
Other changes in 86 76 -5 534 -418 -5 790
equity
Equity 5,529 4,646 11,979 -47 7,319 13,517 42,943
30 Apr. 2010
Equity 5,529 4,646 11,574 -57 6,497 13,923 42,112
1 Nov. 2010
Profit for the 328 646 974
period
Recorded total 328 646 974
profit and costs
during the
financial period
Dividends paid -2,555 -265 -2,820
Share 40 276 316
subscription
Share issue 5,738 5,738
Disposal of own 918 918
shares
Equity component 481 481
of convertible
subordinated
loan
Reward system 11 11
Translation 13 13
differences
Changes in 25 -8 17
minority
interest
Other changes 0 0
Total changes in 40 7,424 13 -2,530 -273 4,674
equity
Equity 5,569 4,646 18,998 -44 4,295 14,296 47,760
30 Apr. 2011
KEY FIGURES
04/2011 04/2010 10/2010
Equity per share, EUR 0.65 0.64 0.61
Earnings/share, diluted, EUR 0.01 -0.04 -0.06
Earnings/share, undiluted, EUR 0.01 -0.04 -0.06
Average number of shares during financial period, 49,118 46,120 46,127
1,000
Number of shares at end of financial period, 1,000 51,733 47,403 47,403
Share issues/CL exchanges during financial period, 4,330 0 0
1,000
Number of shares, 1,000, diluted 59,248 56,245 56,252
Return on equity, % 4.3 -10.9 -6.9
Return on investment, % 4.2 -4.5 -1.1
Gross capital expenditure
To permanent assets, MEUR 5.9 7.2 15.7
% of net sales 7.5 11.4 11.4
Interest-bearing liabilities 68,982 63,636 64,015
Equity ratio, % 33.1 32.2 31.9
Average number of employees 1,006 880 967
GROUP DEVELOPMENT ON A QUARTERLY BASIS
(MEUR) IFRS IFRS IFRS IFRS IFRS IFRS
Q1/10 Q2/10 Q3/10 Q4/10 Q1/11 Q2/11
Net sales 28.2 34.7 34.8 40.2 38.3 40.3
Other operating income 0.0 0.2 0.0 1.6 0.2 0.2
Costs in total -29.0 -32.5 -32.5 -38.2 -36.6 -37.3
Depreciations, amortisations and -0.9 -1.0 -1.2 -1.5 -1.3 -1.5
impairment
Operating profit/loss -1.7 1.4 1.1 2.1 0.6 1.7
Financing items -0.5 -0.6 -0.6 -0.7 -0.6 -0.8
Share of associated company profits 0.0 0.2 0.0 0.0 0.1 0.1
Profit before taxes -2.1 1.0 0.5 1.4 0.1 1.0
Taxes 0.7 -0.1 -0.3 0.1 0.0 0.2
Profit from continuing operations -1.5 0.9 0.2 1.5 0.1 1.3
Profit from discontinued operations -0.6 -1.3 -0.2 -2.1 -0.1 -0.3
Profit for the period -2.1 -0.4 0.0 -0.6 0.0 1.0
Minority interest 0.7 -0.1 0.2 -0.4 -0.1 -0.5
Parent company shareholder interest -1.4 -0.5 0.2 -1.0 -0.1 0.5
GUARANTEES GIVEN
EUR 1,000 2Q/2011 2Q/2010 2010
Guarantees given on behalf of Group companies
Corporate mortgages 40,720 38,847 41,257
Securities given 59,225 52,413 58,942
Other liabilities 680 392 912
Other rental agreements
In one year 5,450 5,217 5,927
In over one year but within five years maximum 13,623 12,522 13,597
In over five years 4,115 5,682 3,957
Total 23,188 23,422 23,481
The nominal or book value has been used as the value of liabilities.
SEGMENT INFORMATION
02/11-04/11 02/10-04/10 11/10-04/1 11/09-04/10
1
NET SALES
Safety 6,021 5,746 11,804 10,270
Digital Printing Services 8,170 5,113 15,183 9,432
HEPAC Wholesale 4,392 4,753 9,187 9,059
Takoma 7,207 4,867 13,801 7,385
Value-added Logistics 3,789 3,827 7,544 7,455
Fittings 2,996 3,197 5,737 5,998
Spare Parts for Motor 2,240 2,046 4,454 3,924
Vehicles
Heat Treatment 2,156 1,684 4,163 2,911
Carpentry Industry 1,525 1,516 3,114 2,730
Supports 885 855 1,722 1,613
Fasteners 764 722 1,466 1,306
Technochemical 375 534 808 1,085
Other 14 13 28 27
Eliminations -190 -198 -400 -332
Group in total 40,344 34,675 78,611 62,863
OPERATING PROFIT
Safety 444 277 602 -387
Digital Printing Services 1,149 1,098 1,737 1,514
HEPAC Wholesale 41 79 75 81
Takoma -105 -71 -351 -739
Value-added Logistics -23 -179 -107 -600
Fittings 221 241 284 410
Spare Parts for Motor 191 69 394 238
Vehicles
Heat Treatment 418 224 902 113
Carpentry Industry 317 254 629 288
Supports 53 27 -3 45
Fasteners -6 -126 -38 -215
Technochemical -103 -5 -224 -27
Other -906 -452 -1,595 -1,003
Group in total 1,691 1,436 2,305 -282
SEGMENT INFORMATION BY QUARTER
Net sales (MEUR) 1Q/10 2Q/10 3Q/10 3Q/10 1Q/11 2Q/11
Safety 4,5 5,8 5,3 6,3 5,8 6,0
Digital Printing Services 4,3 5,1 5,6 6,7 7,0 8,2
HEPAC Wholesale 4,3 4,8 5,0 5,5 4,8 4,4
Takoma 2,5 4,9 4,9 6,8 6,6 7,2
Value-added Logistics 3,6 3,9 3,8 3,8 3,8 3,8
Fittings 2,8 3,2 3,2 3,1 2,7 3,0
Spare Parts for Motor Vehicles 1.9 2.0 2.2 2.4 2.2 2.2
Heat Treatment 1.2 1.7 1.7 2.0 2.0 2.2
Carpentry Industry 1.2 1.5 1.3 1.3 1.6 1.5
Supports 0.8 0.8 0.9 1.1 0.8 0.9
Fasteners 0.6 0.7 0.7 0.8 0.7 0.8
Technochemical 0.6 0.5 0.4 0.6 0.4 0.4
Other 0.0 0.0 0.0 0.1 0.0 0.0
Eliminations -0.1 -0.2 -0.2 -0.3 -0.2 -0.2
Group in total 28.2 34.7 34.8 40.2 38.3 40.3
Operating profit (MEUR) 1Q/10 2Q/10 3Q/10 3Q/10 1Q/11 2Q/11
Safety -0.7 0.3 0.4 1.2 0.1 0.4
Digital Printing Services 0.4 1.1 0.7 1.0 0.6 1.1
HEPAC Wholesale 0.0 0.0 0.1 0.2 0.0 0.0
Takoma -0.7 0.0 -0.4 -0.6 -0.2 -0.1
Value-added Logistics -0.4 -0.2 0.1 0.0 -0.1 0.0
Fittings 0.2 0.2 0.1 0.2 0.1 0.2
Spare Parts for Motor Vehicles 0.2 0.0 0.3 0.3 0.2 0.2
Heat Treatment -0.1 0.2 0.0 0.1 0.5 0.4
Carpentry Industry 0.0 0.3 0.2 -0.1 0.3 0.3
Supports 0.0 0.0 0.2 0.1 -0.1 0.1
Fasteners -0.1 -0.1 0.0 0.0 0.0 0.0
Technochemical 0.0 0.0 -0.1 0.0 -0.1 -0.1
Other -0.6 -0.4 -0.4 -0.2 -0.7 -0.9
Group in total -1.7 1.4 1.1 2.1 0.6 1.7
Panostaja Oyj is an active majority shareholder in Finnish SMEs. The core of
our operations is based on Finnish entrepreneurship and persevering development
of entrepreneurial activity. Together with our entrepreneur partners, we are
cultivating companies to become the best in the field and are thereby creating
Finnish success stories.
Panostaja Oyj functions at the moment in twelve business areas. Oy Alfa-Kem Ab
(Technochemical) manufactures and markets industrial chemicals, cleaning agents
and institutional kitchen agents. Flexim Security Oy (Safety) is a specialist
in security technology and services, locking, door automation and access
control products and solutions. Heatmasters Group (Heat Treatment) offers
thermal treatment services for metals in Finland and internationally, and
produces, develops and markets heat treatment technology. KL-Varaosat (Spare
Parts for Motor Vehicles) is an importer, wholesale dealer and retailer for
original spare parts and supplies intended for Mercedes Benz and BMW cars.
Kopijyvä Oy (Digital Printing Services) is one of Finland's largest companies
offering digital printing services. Lämpö-Tukku Oy (HEPAC Wholesale)
specialises in HEPAC wholesale operations. Suomen Helakeskus Oy (Fittings) is a
significant wholesale dealer concentrating on construction- and furniture-based
fittings. Suomen Kiinnikekeskus Oy (Fasteners) is a supply shop in the fastener
field. Matti-Ovi Oy (Carpentry Industry) manufactures and markets, as its main
product, interior doors of solid wood. Takoma Oyj (Takoma) is a machine shop
group with an entrepreneur-driven business model and is registered on the stock
exchange. Toimex Oy (Supports) works in the HEPAC field, manufacturing and
selling supports for the purpose. Vindea Oy (Added-value Logistics) is an
enterprise specialised in added-value logistics services for the Finnish metal
industry.
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